Los Angeles County housing prices broke records in 2017, and surpassed prices not seen since the 2007 mortgage crisis. That has some people wondering if we are experiencing another real estate bubble. Are you worried?
You may not have reason to worry. CoreLogic, a favorite resource for data geeks like the DIGGS team, has reported that prices across all of Southern California are still 13 percent below their pre-recession peak, when adjusted for inflation.
CoreLogic also predicts that prices will rise another 6.4% before the end of this year. The reason for this increase in home prices is not due to risky lending practices like we saw in 2007 (easy money and unrealistic expectations encouraged people to spend more), but has more to do with a lack of inventory. More people are hanging onto their homes as rental properties, or choosing to stay in a “starter home” rather than make the move to a bigger house and a bigger mortgage.
With fewer homes on the market, homes in our area are selling quickly (median days on market 31 days) and for more than the asking price (102.4% of list price in January).
For the first time buyer (or anyone jumping into the market), these stats can seem defeating, but they are meant to inform and empower. We don’t want you to give up before you start! Knowing that home prices are expected to go up and that there aren’t enough houses to go around will help you to decide if you can afford to wait any longer for the “perfect” house, or realize that it is time to take the leap and find the house that you can make perfect.
Buyers in this market need to be prepared for competition and to be ready to make an offer the minute they find the right house. The DIGGS team will work with you every step of the way to make sure that you are ready when the right house for you comes along.